HCMC boosts industry and trade links

Since 2012 Ho Chi Minh City has held three successful commodity supply and demand conferences

The commodity supply and demand links promotion program that enterprises in Ho Chi Minh City (HCMC) and other localities have been involved in has proven successful. Could you brief some striking results of this program?

Ho Chi Minh City and several eastern and southwestern provinces and cities signed trade cooperation agreements on December 12, 2011 as part of its regional comprehensive trade cooperation strategy, providing the premise for regional governments and enterprises to promote business links and investment cooperation in the fields of agriculture, forestry, fisheries, trade and services, while developing distribution systems and balancing supply and demand as part of efforts to stabilize the market.

Since 2012 Ho Chi Minh City has held three successful commodity supply and demand conferences, which increased the number of corporate participants on an annual basis from 198 businesses in 14 localities in 2012, 347 businesses from 23 localities in 2013 and 1,113 businesses from 38 localities in 2014. As many as 867 sales contracts have been signed with an annual value of VND19 trillion, including VND13 trillion from sales in Ho Chi Minh City.

Through commodity supply and demand promotion activities, many local specialties can now be found in shopping centers, supermarkets and markets in the city. In addition, many producers have become strategic suppliers for large distributors including Saigon Coop, Big C and Lotte Mart while many products have been exported.

How about the implementation of the program?

The program received positive responses from local authorities and businesses. Therefore, its implementation has worked out well, creating strong cohesion between enterprises in Ho Chi Minh City and other localities based on enhanced links due to bilateral investment cooperation, production and sales while contributing to stabilizing the market.

However, there are some shortcomings, which has failed to make the most of local potential and strengths, due to a lack of an overall regional trade development plan.

One of these shortcomings is that the production and distribution links are so weak that some localities can’t afford large scale production of local specialties and have failed to meet requirements on product design, package and quality from large and modern distributors.

What about Ho Chi Minh City’s exports in recent years as the program has contributed to boosting the export of some selected items?

Ho Chi Minh City’s export value rose from US$8.89 billion in 2006 to US$32.08 billion in 2014, marking a 3.6-fold increase.

In the 2007-2014 period, it maintained an annual average export value growth of eight percent thanks to positive market restructuring towards decreasing dependence on China. The city has so far exported many goods items to several potential markets including South Africa, Australia and New Zealand. Its foreign direct investment (FDI) sector recorded slow increases in export value, from 48.6 percent in 2012 to 51 percent in 2014.

To achieve these positive results, the city’s industry and trade sector has conducted several programs, including the commodity supply and demand links promotion program that aims to bring local and regional potential into full play while facilitating domestic enterprises in terms of expansion of market for some key commodities.

Ngoc Anh